In urgent
need of more cash
|
Iconic British travel firm Thomas Cook has failed to find further private investment to stave off collapse and is now relying on an unlikely government bailout, a source close the matter told AFP on Saturday.
The
operator said Friday that it needed £200 million ($250 million, 227 million
euros) -- in addition to the £900-million rescue deal secured last month -- or
else face administration, which could potentially trigger Britain's largest
repatriation since World War II.
A source
close to the negotiations told AFP the company had failed to find the £200
million from private investors and would collapse unless the government
intervened.
But
ministers are unlikely to step in due to worries about the pioneering
operator's longer-term viability, the Times reported on Saturday, leaving it on
the brink of collapse and stranding up to 150,000 British holidaymakers abroad.
"We
will know by tomorrow if agreement is reached," the source told AFP.
The
Transport Salaried Staffs Association, which represents workers at the company,
called on the government to rescue the firm.
"It is
incumbent upon the government to act if required and save this iconic
cornerstone of the British high street and the thousands of jobs that go with
it," said TSSA General Secretary, Manuel Cortes.
"The
company must be rescued no matter what."
Two years
ago, the collapse of Monarch Airlines prompted the British government to take
emergency action to return 110,000 stranded passengers, costing taxpayers some
£60 million on hiring planes.
The
government at the time described it as Britain's "biggest-ever peacetime
repatriation".
Thousands
of workers could also lose their jobs, with the 178-year-old company employing
about 22,000 staff worldwide, including 9,000 in Britain.
Chinese
peer Fosun, which was already the biggest shareholder in Thomas Cook, agreed
last month to inject £450 million into the business.
In return,
the Hong Kong-listed conglomerate acquired a 75-percent stake in Thomas Cook's
tour operating division and 25-percent of its airline unit.
Creditors
and banks agreed to inject another £450 million under the recapitalisation plan
announced in August, converting their debt in exchange for a 75-percent stake
in the airline and 25 percent of the tour operating unit.
Thomas Cook
in May revealed that first-half losses widened on a major write-down, caused in
part by Brexit uncertainty that delayed summer holiday bookings. The group,
which has around 600 stores across the UK, has also come under pressure from
fierce online competition.
#UPDATE British travel firm #ThomasCook collapsed into bankruptcy on Monday, leaving some 600,000 holidaymakers stranded and sparking the UK's biggest repatriation since World War II https://t.co/YTp8hR58Aj By @benperry28 pic.twitter.com/OnAt5onUZ1— AFP news agency (@AFP) 23 september 2019
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